We study workers who are employed by a large US retailer, work in many store locations, and are paid based on performance. By means of a border-discontinuity analysis, we document that workers become more productive and are terminated less often after a minimum wage increase. These effects are stronger among workers whose pay is more often supported by the minimum wage. However, when workers are monitored less intensely, the minimum wage depresses productivity. We interpret these findings through an efficiency wage model. After a minimum wage increase, profits decrease, and a calibration exercise suggests that worker welfare increases.

Minimum wage and individual worker productivity: evidence from a large US retailer

Deserranno, Erika;
2022

Abstract

We study workers who are employed by a large US retailer, work in many store locations, and are paid based on performance. By means of a border-discontinuity analysis, we document that workers become more productive and are terminated less often after a minimum wage increase. These effects are stronger among workers whose pay is more often supported by the minimum wage. However, when workers are monitored less intensely, the minimum wage depresses productivity. We interpret these findings through an efficiency wage model. After a minimum wage increase, profits decrease, and a calibration exercise suggests that worker welfare increases.
2022
2022
Coviello, Decio; Deserranno, Erika; Persico, Nicola
File in questo prodotto:
File Dimensione Formato  
720397.pdf

accesso aperto

Descrizione: article
Tipologia: Pdf editoriale (Publisher's layout)
Licenza: Creative commons
Dimensione 663.31 kB
Formato Adobe PDF
663.31 kB Adobe PDF Visualizza/Apri

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11565/4060905
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 20
  • ???jsp.display-item.citation.isi??? 17
social impact